Whenever there is a flash flood in your area, a potential flood insurance claim may arise. Lots of homeowners don’t think that floods will affect their property until it is too late. In the past 10 years, all fifty of the United States experienced floods. Some of the events even led to damage that amounted to billions of dollars. The worst thing about this is that a lot of the people who suffered damage did not get flood insurance coverage.
Before any catastrophe strikes, homeowners should ask what is covered in their policy. Here are the flood insurance myths that insurers should spot.
1) Homeowners insurance covers flood damage
A huge percentage of American homeowners do not have flood insurance. A lot of people believe that the homeowner’s policy provides coverage for flood. But in reality, this is not the case. The standard homeowners’ insurance policy does not cover a home’s flood damage.
Homeowners may buy flood insurance through the National Flood Insurance Program. The flood insurance premiums may start at $112 a year for residential properties. Such amount may increase depending on the amount of coverage the homeowner needs. It may also vary according to the home’s flood risk.
2) Only a few homes are in flood zones.
Everywhere rain falls is a flood zone. Some flood zones may carry a higher risk than others. The FEMA, Federal Emergency Management Agency, study the country’s flood risk. They map them using GIS information. People can view the maps online at FEMA’s website.
3) A 100-year flood zone only experiences flood once every century.
The 1,000-year, up to the 25-year floods refer to the flood’s probability of occurrence. A 25-year flood has a 4% chance of occurring every year. A 100-year flood has a 1% chance of happening yearly. A 1,000-year flood has a lower risk of 0.1% every year.
But, it does not mean that flood in 100-year or 1,000-year zones will not happen. They also don’t mean that the flood will only happen once during that time. According to the U.S. Geological Survey, an area may flood more than once or not at all for 100 years. It may happen even if it is in a 100-year flood zone.
4) You only need flood insurance for high-risk areas.
People may get flood insurance regardless of their home’s risk level. Low-risk areas may still experience a catastrophe. Twenty-five percent of flood insurance claims come from low-risk homes.
Flood risk may change over time. Areas that recently had environmental changes may be more susceptible to flood. Whenever this happens, mortgage companies may require property owners to get flood insurance.
5) Flood insurance can repair and replace everything.
The NFIP’s flood insurance policies only cover up to $100,000 for belongings. Their policies cover up to $250,000 for structural damage. The exact coverage may be different for commercial property owners and renters. It may also vary for single family homeowners. Private insurance companies have their list of aspects affect the coverage and rates for different kinds of properties.
Flood insurance may not be on the mind of every property owner. But, it is actually essential than what others might think. You may encounter owners who don’t know their flood risk. When you do, always remember these facts. Be prepared to bust their myths.
At NoBSFloodInsurance we specialize in helping people all over the country find the right flood insurance for their needs to avoid a financial catastrophe. To learn more about how we can help you, please contact our agency at (800) 747-5311 or Click Here to request a free quote.